How to Help Your Banker Say Yes

I had a great meeting with my client and his banker as we approached him about increasing my client’s line of credit. For the past four years he has banked at a local community bank.  My client has the good fortune that his business is doing quite well.  Of course he thoroughly knows his business, and from a qualitative standpoint, he is able to clearly articulate his successes over the past year.  However, having a financial expert at the meeting with a deep understanding of the business supported with quantitative financial data, gave our banker comfort that data and results supported the qualitative discussion.

During our presentation to the banker, my client discussed the milestones that were achieved during the past fiscal year.  He talked about new customers acquired, relationships forged and problems solved.  I have been working with my client for the past two years and have gained an intimate understanding of his business.  After my client’s qualitative update of the business results, I was able to jump in and demonstrate how the business financial results supported the qualitative results.  In addition to a P&L and balance sheet, I supplied the banker with various management reports that we use to operate and monitor the business.

The banker is use to dealing with business owners that typically have a bookkeeper or controller who don’t’ prepare these types of analyses.  The bottom line is to get the ultimate cooperation from your banker you need a successful business and financial data that supports the verbal discussion.  Most good bankers like data that they can review and input in their models.  But more importantly, they want to know the management team is knowledgeable about the details of their business and they run the business in a professional and objective manner.

In the end our banker agreed to increase my client’s line of credit, allowing him to continue to grow his business.  Our banker left the meeting satisfied that he was able to help a local successful business with more capital and my client left the meeting knowing he would be able to continue growing his business with sufficient capital.  A win-win for everyone.

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